EUR/usd
Just as we expected, the profit-squeeze lasted till the end of the week. It's remarkable that the stock markets were moving in the opposite direction. This performance doesn't look surprising if we regard it as the year-end portfolio rebalancing. Thus, on Friday eurusd dropped below 1.32 and at some point hit 1.3160. Yet now purchases in the pair are rather moderate. In the meantime, the US stock indices, which were appreciating at the end of the previous week, are sliding down. Apparently, the markets will demonstrate the same unconformity till the end of the week, with a new trend setting only at the beginning of the next year. Its direction will be largely influenced by the outcome of negotiations around the fiscal cliff. At the moment the tone of statements is less confident. Trying to be optimistic, the parties say that an agreement can still be reached. Translating it from the political language into the plain human one, the chance is really slim. It's really discouraging since the failure to reach an agreement may kill any optimism in the markets. And this optimism has been aroused with such a great difficulty – by means of numerous economic releases. Thus, Friday's Durable Goods Orders demonstrated a handsome growth. Total orders rose by 0.7% m/m and Durables ex transportation increased by 1.6% after 1.9% last month and 1.7% two months ago. It reflects a much higher activity among US corporations. Very often it is accompanied by depreciation of the dollar, which we expect this time as well. Yet the major threat is still posed by the fiscal cliff negotiations and their outcome. It would be right to enter the market after the decision on this issue is known.
GBP/USD
The British pound looked weaker than the rest of majors on Friday. Having dropped below 1.62, gbpusd stumbled over heavy selling, which pushed the pair down to the low of 1.6140. At the beginning of trading in Europe the pound recouped a part of its losses. The only more or less important news today is another drop of housing prices. According to Hometrack, it makes 0.1%. The annual decline of the indicator is 0.3% in December, just like a month ago. EURGBP remains close to 0.8150, however it doesn't seem to have enough strength to break through this level this year. It's really interesting whether GBPUSD will manage to consolidate above 1.62 or not.
USD/JPY
usdjpy again started the week's sessions at an upward gap, but doesn't risk to move further. It's largely the result of scanty news background and half-dead state of the markets. The pair was consolidating in the range 83.80-84.60 for the most part of the previous week. It might have been preparation for the upsurge. The next potential target extremum of the pair is 85.50. Yet, it was already hit 1 ½ years ago on the CB's interventions and therefore may be ignored by the market participants. Most likely, the consolidation will be followed by the further growth and the downtrend of the pair, once broken in 2011, will reverse once and for all in 2013.
NZD/USD
The New Zealand dollar hasn't been the market's favourite for long. Since the middle of the month nzdusd hasn't managed to consolidate. The initial moderate profit-taking, which started a couple of weeks ago, turned into a real sell-off on Friday. Kiwi has already dropped to 0.8220. Apparently, the pair feels more confident close to its 200-day MA, it means at 0.8070.
